Reading Time: 3 minutes Smart Ways to Make Money with Crypto
This is a post by Ellie Jo about making money.
The cryptocurrency industry has been growing massively ever since the idea of bitcoin was born in 2008 and 2009. In 2017, the search term “how to buy BTC” ranked 3rd among the most popular “how-to” searches on Google. The big question is, what are the best ways to make money with cryptocurrencies? Given the high volatility of digital currencies like BTC, there are several ways investors can generate some income from the comfort of their homes. Here are four best ways to earn money from crypto.
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Buying and HODLing BTC
In the cryptocurrency context, “HODL” means to buy valuable crypto coins and hold them for the long-term in the hope of reselling them during a market boom. Bitcoin (BTC) and Ethereum (ETH) are two popular cryptocurrencies that are good options for HODLing.
The world’s most valuable digital currency (Bitcoin) more than doubled in value in 2019 and has grown steadily since then. As of January 2021, the average cost of one Bitcoin briefly reached $40,000. HODLers often buy Bitcoins when the price falls and wait until there’s a significant increase in price before they sell their assets. However, it’s important to understand that you won’t earn interest on your funds when you HODL.
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Trading
Cryptocurrency trading is much similar to stock trading, where people buy or sell coins for profit margins. Several cryptocurrency exchanges allow users to purchase crypto and trade them for profit. As of February 2020, over 300 digital currency exchange providers had registered with the Australian Transaction Reports and Analysis Center (AUSTRAC). Swyftx exchange is one fast-rising cryptocurrency exchange in Australia that’s very convenient for crypto trading.
An online Swyftx review will show how Australia’s premier crypto exchange provides over 170 assets. Day-trading is meant for people who’re eager to make enough money buying and selling cryptocurrencies on the same day. Traders buy crypto coins and sell them at higher prices to other consumers.
When trading crypto, be sure to factor in tax consequences. Taxes are a rapidly evolving space, with different countries handling taxes differently.
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Airdrops and forks
Airdrops are free tokens that are usually issued by crypto exchanges to create people’s awareness of a project. A fork represents an upgrade in a protocol that creates new coins. The holders of the coin assets on the original blockchain are given free tokens on the new network. You can benefit from airdrops and forks when you follow the latest crypto markets. You can sign up for airdrops, discover the best trading platforms and sell your free tokens for profit.
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Lending
Like traditional fiat currency, you can put your crypto assets to work for you through crypto lending and staking platforms. Lend your crypto assets to other investors and generate interest on your loans. There are peer-to-peer BTC lending platforms that connect borrowers with lenders. In BTC lending platforms like Coinbase, borrowers may be asked to provide collateral for their loans. The maximum amount of crypto one can borrow will depend on their collateral. Lending platforms reserve the right to sell off a borrower’s collateral if they miss their payments.
Rachel is an Austin blogger, educator, mom, wife, young breast cancer survivor writing about health, saving money, and living a happy life in Austin, Texas.
Rachel has written for HuffPost and Hometalk and has been featured on KXAN, Studio 512, Fox 7 Austin, and CBS Austin.